Resistance from old high and recent low between here and 6500,plus the declining 20x1 angle.Watch for doji or shooting star failure in this zone,else its a breakout.Lot of cycles this week
Likewise I am looking for a failure in the s&p between 1365 (fib on the close only chart) and 1370 ,last year's high which is the critical resistance zone

I have a hard time from a fundamental point of view in seeing today as anything more than another short-covering rally following another kick-the-can down the road announcement that does not address the fundamental problems of the Eurozone structure.Nevertheless bears need to monitor this potential bullish setup and hope for a swift reversal.Last 2 years saw a significant reversal in the first week of July in most markets.

Interestingly,the FTSE chart does not look as worrying from a bear's perspective.Is this because of concern over UK banks ? Chinese slowdown effect on miners ?

Here is an excerpt from an excellent free newsletter "Things that make you go Hmm" If you google it you should get a link for free subscription

I will leave the final word to a gentleman
whom, regular readers will know, I count
amongst the very finest of observers; someone
who, for many years has demonstrated an unsurpassed
ability when it comes to explaining, in
the most concise way possible, the absurdities of
the current situation and who has featured regularly
in these pages—Bill Fleckenstein.
Just this week, Bill wrote the following passage
for his paid subscribers which he very kindly
gave me permission to reproduce here:
(Readers wishing to have regular access to Bill’s
wisdom can click here to subscribe. I cannot recommend
his work highly enough)
Even though I have been saying virtually the
same thing for 20 years, it still boggles my
mind that the people running the Fed can be
so amazingly and demonstratively incompetent,
yet they are entrusted with unequalled
power to change the course of history and
people’s futures based on their pet theories
(and bolstered by ego-boosting reinforcement
from the applause meter). Although
Bernanke is not the egomaniac that Greenspan
was, he has done no less damage. On the
other hand, had Greenspan not done what
he did, Bernanke probably wouldn’t have followed
the course that he has.
When I wrote my book, “Greenspan’s Bubbles,”
in 2008, I figured that in a few years
(and certainly by now) the whole world
would have seen what a catastrophe Greenspan
and the Fed were, and the tremendous
negative influence they have had on the
country. But here we are four years, trillions
of dollars’ worth of damage, and millions of
ruined lives later, and people are still unable
to see the obvious. It is just incredible that
something this evident continues to be unrecognized
by so many people the world over.

Germans tell US to get their own house in order ! http://globaleconomicanalysis.blogspot.co.uk/2012/06/german-finance-minister-lectures-obama.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+MishsGlobalEconomicTrendAnalysis+%28Mish%27s+Global+Economic+Trend+Analysis%29

A continuation sell signal was given on Thursday with the big black candle that took out 3 lows.The initial decline was a perfect 90 degree move (3 months) Pricewise we seem to be following the square of 144

The 3rd test of the neckline was met by a double close key reversal (basically an engulfing candle that closed below the 2 previous closes).This is one of Jeff Kennedy's favorite reversal day patterns The 2 day swing chart was Gann's favorite mechanical trend indicator

I have had to adjust the neckline since I last posted this chart and have added a 90 dma.The pivot based on the 3 month cycle and on time symmetry now looks to be a high that has tested this neckline and the 90 dma,whereas my initial projection had been for a low

Here is the same chart with 150 dma instead of 200.I also played around with some time cycles and a 100% range projection for a guess at what the market might do next.Obviously we trade off price,not guesses,no matter how well informed but it can be useful to have a roadmap

well today was a nothing day after yesterday's sell-off when investors finally realised there was no immediate dose of QE to bail out the markets.Next week has the potential to be ugly and the dollar looks strong